Chinese company may continue demolition work

Download article in original language : NL9707124NNL.DOC

The Chinese company CMIC may continue its controversial demolition of two blast furnaces on the premises of the Dutch steel concern Hoogovens, after the Central Office of the Employment Service decided in July 1997 against suspending its work permit.

The Central Office of the Employment Service (Centraal Bureau voor de Arbeidsvoorziening, CBA) has decided against suspending CMIC's work permit after the company announced that it would pay all 120 Chinese employees according to the Dutch collective agreement for the sector. At an earlier stage, the Industrial Union of the Dutch Trade Union Federation (Industriebond FNV) had demanded an immediate halt to the demolition work because the Chinese company was suspected of not complying with safety regulations and the sector's collective agreement (NL9706118N).

The Chinese company has been contracted by the Indonesian company Gunawan Iron and Steel to dismantle two blast furnaces that were bought from Hoogovens. The blast furnaces are then to be rebuilt in Malaysia. When applying for the demolition permit, both Gunawan and Hoogovens are said to have promised that they would meet Dutch standards regarding terms of employment and working conditions. However, despite supervision of safety standards by Stork, a major Dutch industrial technology firm, a series of accidents in which two Chinese employees were killed made it painfully clear that safety regulations were not being met. Only after Industriebond FNV reported the situation to the Labour Inspectorate in May 1997 was the company forced to improve working conditions.

Industriebond FNV also discovered that the Chinese employees were paid much less than the Dutch minimum wage, and that the employer did not comply with the terms of the metalworking sector's collective agreement. The CBA started an investigation into these matters. In early July 1997, before the CBA had decided whether to suspend the work permit, CMIC promised to apply Dutch standards to its employees. Approximately 120 Chinese workers will now receive retrospective payment in line with the sector's collective agreement. This will amount to a payment of an additional NLG 15,000 for each employee. The public prosecutor will consider whether a claim for compensation will be filed on behalf of those involved in the accidents.

According to the permit applicants, Hoogovens and Stork, CMIC had to carry out the demolition activities because it was already contracted to reassemble the blast furnaces in Malaysia. However, basing its view on sources at Stork, Industriebond FNV argued that Hoogovens did not necessarily have to contract out the demolition work. Industriebond FNV feels that sufficient drawings were available to have the demolition done by Dutch employees, and the rebuilding done by others. In the opinion of Industriebond FNV, the CBA should never have granted the work permit in the first place.

Useful? Interesting? Tell us what you think. Hide comments

Eurofound welcomes feedback and updates on this regulation

Add new comment